Becoming a parent is one of the most important milestones for many of us in our life. It not only gives you immense joy but also brings with itself responsibilities for a lifetime. As a parent, you would only want to give the best of everything to your loved one – be it the best education, or the best lifestyle and want to provide them with every opportunity to accomplish their goals.
However, in view of the rising inflation, growing education costs and medical expenses, it may be hard to maintain your lifestyle for long. Therefore, it is pivotal that you plan your finances and invest in a child insurance plan as soon as you can. Today, many insurance companies offer a wide range of life insurance plans for children. If you have no prior experience with insurance purchases, choosing the right policy can be overwhelming.
So, to help you purchase the right plan and secure your child’s future, we have listed down a few vital tips for buying a child insurance policy.
- Buy child insurance at an early stage
Most financial advisors recommend the new and soon-to-be parents purchase a child insurance plan at the earliest. It is best to buy such a plan as soon as the child is born. This way, you provide your child with the safety net against the uncertainties from day one of your baby coming into the world.
Typically, child insurance plans offer maturity benefits wherein the insurance company releases pay out at specific stages of the child starting from 18 years. When you buy child insurance early, you can leverage the time benefit to build a larger corpus over time.
- Choose premium waiver option
Just like any other insurance policy, you can purchase riders with your child insurance policy. It is advisable to opt for a premium waiver option to ensure that the plan continues after your demise. Also, after your death, the insurer will waive off the future premiums, and your child will continue to get the policy benefits.
- Premium payment mode and amount
The premium you pay for child insurance would depend on several factors, including the sum assured, the maturity amount you opt, the type of plan you choose, etc. So, when you buy a child insurance policy, you must estimate the sum assured that you would want to receive at maturity and invest accordingly.
Also, you must be careful about choosing the premium payment mode. Generally, insurance companies offer child insurance plans with regular premium payment mode and single premium payment mode. You can pay the premium annually, half-yearly, quarterly, or monthly in regular premium payment mode.
- Consider the inflation
You buy a child insurance plan to secure your child’s financial future. So, you must carefully choose the sum assured, considering the inflation. This is vital to ensure that your child gets enough funds to cover their expenses, even as the cost rises every year.
Final Word
Buying a child insurance policy is an important financial decision. You must do your research well, know about the different plans, their features, terms and conditions and choose the best policy online to suit your needs.
